Letter to House and Senate Department of Defense Authorization Conferees Urging Opposition to Attaching Federal Prison Industries Bill (HR 1577) to DOD Authorization Bills

The Honorable Carl Levin, Chairman
Senate Armed Services Committee
269 Russell Senate Office Building
Washington, DC 20510

Re: Oppose Attaching Federal Prison Industries Bill (HR 1577) to Department of Defense Authorization Bills

Dear Chairman Levin and Members of the Defense Authorization Conference Committee:

We are writing to urge you to oppose any attempts to add H.R. 1577 to the Defense Authorization Bills (H.R. 4546 and S 2514). H.R. 1577 passed out of the House Judiciary Committee and was reported to the Committee of the Whole on July 16, 2002 (Report No. 107-583). The bill would cripple the Federal Prison Industries Program (FPI, also commonly referred to as UNICOR) and eliminate thousands of employment opportunities for prisoners.

The ACLU supports prison industry programs, if they are run in a way that does not exploit inmates, because meaningful work programs are an important component of rehabilitation. Most prisoners have poor literacy skills and few job skills, therefore a history of unemployment and crime. Programs that reduce illiteracy allow prisoners to earn a high school diploma, and provide vocational training and work skills are beneficial to a prisoner’s rehabilitation and have been shown to be very effective in decreasing recidivism. A program that provides real work experience can teach useful job skills and good work habits which will be vital to the ex-offenders reintegration into the community.

FPI runs effective and valuable rehabilitative programs. These programs help prisoners gain important life skills thereby decreasing recidivism, give prisoners income which they can use to pay restitution to victims, fines to the government and money to their families.

H.R. 1577 eliminates the mandatory sourcing requirement, a provision in current law that requires the federal government to purchase certain products from FPI if they can meet the needs of the contract at a competitive rate. The ACLU does not take a position on the merits of mandatory sourcing. However, we oppose H.R. 1577 because it would curtail prison work opportunities by both eliminating mandatory sourcing while imposing on FPI affirmative barriers (relating to market share) to contracting with the federal government that companies in the private sector do not face. At the same time, the bill does not offer other alternative programs that would allow FPI to replace the inmate work opportunities that the bill result from the loss of mandatory sourcing. Currently, 22, 560 prisoners are employed in FPI. Conservative estimates indicate that H.R. 1577 will cause the loss of 50% of its work opportunities immediately. Unless FPI can restructure the overtime program, it will likely close down completely.

H.R. does not provide sufficient alternatives to make up for losing the mandatory source provision.

During mark-up on H.R. 1577, an amendment was attached to the bill to permit FPI to provide certain products to charitable institutions. While this amendment is laudible, it cannot take the place of the mandatory sourcing provision for two reasons: (1) The bill contemplates the federal government will need to pay inmates to produce products for charitable organizations. Unless Congress appropriates the money for these programs, the jobs will not materialize. ( It is unlikely that charities will pay inmates because they already receive a lot of voluntary work from inmates). (2) Manufacturing products for charities is unlikely to lead to employment opportunities for inmates once they are out of prison because the type of work that inmates would likely do for charities, such as sewing garments, making toys, are low-skilled jobs, many of which have gone out overseas.

Opponents of FPI claim that it should have to compete on the open market, yet H.R. 1577 makes it impossible for FPI to do so.

Many opponents of FPI criticize the program on the grounds that it enjoys an unfair competitive advantage because of mandatory sourcing and cheap prison labor. We disagree with this presumption. There are significant costs associated with prison industry not faced by the private sector such as paying for security and costs associated with high turnover due to prisoners being released or transferred. However, the proponents of H.R. 1577 want to put FPI at a competitive disadvantage. H.R. 1577 would prohibit FPI from getting more than 20% of the market share for products and no more than 5% of the market share of any services provided. This market barrier puts FPI at a severe disadvantage. For example, the FPI would lose several important contracts, including its current contract to repair postal bags for the postal service for which it currently has 98% of the market share. Losing this one contract will result in the loss of several thousand jobs alone. If the proponents of H.R. 1577 want fair competition, then the market cap should be stricken from H.R. 1577.

Federal Prison Industries is not Displacing Private Sector Jobs

Another criticism of FPI is that it displaces jobs from non-prisoners. The FPI actually creates jobs. Three quarters of every FPI dollar goes to purchase material from 15,000 private sector vendors nationwide. Sixty-one percent of the purchases are made from small, minority, women-owned, and disadvantaged businesses.

A 1996 analysis by FPI of office systems furniture sales concluded that FPI’s sales resulted in more private sector jobs than would have been the case if the products were produced in the private sector. FPI gives the government a tremendous “bang for the buck”.

Inmates in Federal Prison Industries are being taught marketable skills

The most important positive skill taught by FPI is a work ethic. The FPI had a very positive impact on inmates. A major longitudinal research study conducted by the Bureau of Prisons concluded that inmates who worked in FPI while in custody were substantially more likely upon release to be employed and earning higher wages and were 24% less likely to be engaged in criminal behavior. Reductions in recidivism can have enormous impact on public safety, criminal justice costs, reimbursement to victims and strengthened family ties. Instead of cutting back on prison industry, Congress should be passing legislation to provide greater opportunities for prison employment. We urge the Conference Committee to reject attaching H.R. 1577 to the DOD authorization bill.

If Congress is going to eliminate mandatory sourcing, it should provide an alternative means for maintaining levels of prison industry participation. The ACLU and the Enterprise Prison Institute both support an amendment to create a new pilot program that would allow FPI to enter into some contracts with private industry thus creating up to 10,000 new job opportunities for federal inmates. We would be happy to share this amendment with any interested parties.

Thank you.

Sincerely,

Laura Murphy, Director
Washington National Office
American Civil Liberties Union

Rachel King, Legislative Counsel
Washington National Office
American Civil Liberties Union

Cc: House and Senate DOD Authorization Conferees